INVESTMENTS AND FAIR VALUE MEASUREMENT

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

INVESTMENTS AND FAIR VALUE MEASUREMENT

NOTE 6: INVESTMENTS AND FAIR VALUE MEASUREMENT

Investments

Available-for-sale

As of December 31, 2023 and September 30, 2024, we had $500 million and $750 million of available-for-sale time deposits classified as cash equivalents on the unaudited condensed consolidated balance sheets. These investments had a maturity of three months or less at the time of purchase, and an aggregate market value equal to amortized cost. Refer to Fair Value of Financial Instruments below for further details.

Held-to-maturity

The following tables summarize our held-to-maturity investments:

	December 31, 2023
(in millions)	Amortized Cost		Allowance for Credit Losses		Unrealized Gains		Unrealized Losses		Fair Value
Debt securities:
Corporate debt securities	$	205	$	—	$	—	$	(1)	$	204
U.S. Treasury securities	202		—		—		—		202
U.S. government agency securities	42		—		—		—		42
Certificates of deposit	34		—		—		—		34
Commercial paper	3		—		—		—		3
Total held-to-maturity investments	$	486	$	—	$	—	$	(1)	$	485

	September 30, 2024
(in millions)	Amortized Cost		Allowance for Credit Losses		Unrealized Gains		Unrealized Losses		Fair Value
Debt securities:
U.S. Treasury securities	$	426	$	—	$	1	$	(1)	$	426
Corporate debt securities	91		—		—		—		91
U.S. government agency securities	10		—		—		—		10
Total held-to-maturity investments	$	527	$	—	$	1	$	(1)	$	527

There were no sales of held-to-maturity investments during the three and nine months ended September 30, 2024.

The table below presents the amortized cost and fair value of held-to-maturity investments by contractual maturity; the maximum maturity is two years:

	December 31, 2023
(in millions)	Within 1 Year		1 to 2 Years		Total
Amortized cost
Debt securities:
Corporate debt securities	$	153	$	52	$	205
U.S. Treasury securities	184		18		202
U.S. government agency securities	39		3		42
Certificates of deposit	34		—		34
Commercial paper	3		—		3
Total held-to-maturity investments	$	413	$	73	$	486
Fair value
Debt securities:
Corporate debt securities	$	152	$	52	$	204
U.S. Treasury securities	184		18		202
U.S. government agency securities	39		3		42
Certificates of deposit	34		—		34
Commercial paper	3		—		3
Total held-to-maturity investments	$	412	$	73	$	485

	September 30, 2024
(in millions)	Within 1 Year		1 to 2 Years		Total
Amortized cost
Debt securities:
U.S. Treasury securities	$	426	$	—	$	426
Corporate debt securities	91		—		91
U.S. government agency securities	10		—		10
Total held-to-maturity investments	$	527	$	—	$	527
Fair value
Debt securities:
U.S. Treasury securities	$	426	$	—	$	426
Corporate debt securities	91		—		91
U.S. government agency securities	10		—		10
Total held-to-maturity investments	$	527	$	—	$	527

Fair Value of Financial Instruments

Financial assets and liabilities measured at fair value on a recurring basis were presented on our unaudited condensed consolidated balance sheets as follows:

	December 31, 2023
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents:
Time deposits	$	—	$	500	$	—	$	500
Money market funds	146		—		—		146
Deposits with clearing organizations:
U.S. Treasury securities(1)	50		—		—		50
Other current assets:
Stablecoin	20		—		—		20
Equity securities - securities owned	10		—		—		10
Other non-current assets:
Money market funds - escrow account	2		—		—		2
Asset related to user cryptocurrencies safeguarding obligation	—		14,708		—		14,708
User-held fractional shares	1,592		—		—		1,592
Total financial assets	$	1,820	$	15,208	$	—	$	17,028
Liabilities
User cryptocurrencies safeguarding obligation	$	—	$	14,708	$	—	$	14,708
Fractional shares repurchase obligations	1,592		—		—		1,592
Total financial liabilities	$	1,592	$	14,708	$	—	$	16,300

	September 30, 2024
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents:
Time deposits	$	—	$	750	$	—	$	750
Money market funds	60		—		—		60
U.S. Treasury securities	8		—		—		8
Other current assets:
Stablecoin	21		—		—		21
Equity securities - securities owned	14		—		—		14
Other non-current assets:
Money market funds - escrow account	2		—		—		2
Asset related to user cryptocurrencies safeguarding obligation	—		19,456		—		19,456
User-held fractional shares	2,201		—		—		2,201
Total financial assets	$	2,306	$	20,206	$	—	$	22,512
Liabilities
User cryptocurrencies safeguarding obligation	$	—	$	19,456	$	—	$	19,456
Fractional shares repurchase obligations	2,201		—		—		2,201
Total financial liabilities	$	2,201	$	19,456	$	—	$	21,657

____________________________

(1) During the year ended December 31. 2023, U.S. Treasury securities were pledged to a clearing organization to meet margin requirements for our security lending program.

The fair value for certain financial instruments that are not required to be measured or reported at fair value was presented on our unaudited condensed consolidated balance sheets as follows:

	December 31, 2023
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Held-to-maturity investments:
Corporate debt securities	$	—	$	204	$	—	$	204
U.S. Treasury securities	202		—		—		202
U.S. government agency securities	—		42		—		42
Certificates of deposit	—		34		—		34
Commercial paper	—		3		—		3
Total held-to-maturity investments	$	202	$	283	$	—	$	485

	September 30, 2024
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Held-to-maturity investments:
U.S. Treasury securities	$	426	$	—	$	—	$	426
Corporate debt securities	—		91		—		91
U.S. government agency securities	—		10		—		10
Total held-to-maturity investments	$	426	$	101	$	—	$	527

The fair values used for held-to-maturity investments are obtained from an independent pricing service and represent fair values determined by pricing models using a market approach that considers observable market data, such as interest rate volatility, relevant yield curves, credit spreads and prices from market makers and live trading systems. Management reviews the valuation methodology and quality controls utilized by the pricing services in management's overall assessment of the reasonableness of the fair values provided.

During the nine months ended September 30, 2024, we did not have any transfers in or out of Level 3 assets or liabilities.

Safeguarded user cryptocurrencies

Safeguarded user cryptocurrencies were as follows:

	December 31,		September 30,
(in millions)	2023		2024
Bitcoin (BTC)	$	6,149	$	9,416
Ethereum (ETH)	3,761		4,014
Dogecoin (DOGE)	3,319		4,001
Other	1,479		2,025
Total user cryptocurrencies safeguarding obligation and corresponding asset	$	14,708	$	19,456

The fair value of the user cryptocurrencies safeguarding obligation and the corresponding asset were determined based on observed market pricing representing the last price executed for trades of each cryptocurrency as of December 31, 2023 and September 30, 2024.